Gold takes a breather, but stimulus outlook supports

Friday, 15 Nov 2013 | 8:46 AM ETReuters

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Junko Kimura | Bloomberg | Getty Images

Gold edged lower on Friday as investors took profits after two days of gains sparked by assurances from the likely new Federal Reserve chief that the U.S. central bank will continue its easy monetary policy for now.

Fed Chair nominee Janet Yellen said on Thursday she would press forward with the central bank's ultra-easy policy until officials were confident a durable economic recovery was in place that could sustain job creation.

Answering questions before the Senate Banking Committee, Yellen defended the Fed's steps to spur growth, calling efforts to boost hiring an "imperative'' at a hearing on her nomination to become the first woman to lead the U.S. central bank.

Spot gold fell 0.2 percent to $1,295 an ounce, bringing the gains over the past three sessions to 1.8 percent.

Yellen's comments earlier in the week lifted the metal from a near four-week low of $1,260.89 hit on Tuesday, but prices failed to advance above the crucial $1,300 level on a lack of strong investor interest, traders said.

Gold has fallen nearly 25 percent this year after the Fed signaled it would begin slowing its $85 billion monthly bond purchases.